As Lebanon restarts talks with the International Monetary Fund to address its dire economic crisis, analysts warn that political pressure from the country’s international donors could lead to a deal with far fewer economic reforms than IMF demands — thereby emboldening Lebanon’s political elites and exacerbating inequality.
Donors have long demanded that Lebanon reach a deal with IMF before they’ll release billions of dollars in development aid. Lebanon’s new government, which was formed in September after a year of paralysis, says it intends to meet that prerequisite. The man leading the charge is Prime Minister Najib Mikati, a 65-year-old telecommunications billionaire.
IMF typically imposes reform demands and some forms of austerity on governments in order for them to qualify for assistance. Amer Bisat, an expert on Lebanon’s economy and the head of Sovereign and Emerging Markets Investments at BlackRock, who said he is not speaking on the firm’s behalf, told Devex he predicts Lebanese officials will push for a “skinny deal” with IMF to avoid enacting comprehensive reforms that would threaten their political power.